The Natural Logic of Management Policy Making: Its Implications for the Survival of an Organization

Abstract

A process-theoretic approach, seldom used but not without promise for organizational behavior research, is employed to postulate a process model of the natural logic evident in organizational policy making. The model is used to explain how the policies of a sample firm (for which 20 years of data are available) became adopted and how, together with critical events, this caused the firm to evolve in particular directions rather than others. Implications of the study are put forward in terms of identifying pathologies of the policy making process. Some prescriptions are put forward for the proper control of organizations by supervisory bodies, such as boards of directors. It is suggested that Management Science, in the form of systematic procedures for adaptive organizational design and updatable cause maps, may have an important future role to play in senior management affairs.